fixed income presentation - bnp paribas · 2019-05-21 · fixed income presentation – asia - may...
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| 1
BNP ParibasSustainable growth
throughout the cycle
Asia - May 2011
Fixed Income Presentation
Fixed Income Presentation – Asia - May 2011 | 2
Disclaimer
Figures included in this presentation are unaudited.
This presentation includes forward-looking statements based on current beliefs and expectations about future events. Forward-looking statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future events, operations, products and services, and statements regarding future performance and synergies. Forward-looking statements are not guarantees of future performance and are subject to inherent risks, uncertainties and assumptions about BNP Paribas and its subsidiaries and investments, developments of BNP Paribas and its subsidiaries, banking industry trends, future capital expenditures and acquisitions, changes in economic conditions globally or in BNP Paribas’ principal local markets, the competitive market and regulatory factors. Those events are uncertain; their outcome may differ from current expectations which may in turn significantly affect expected results. Actual results may differ materially from those projected or implied in these forward-looking statements. Any forward-looking statement contained in this presentation speaks as of the date of this presentation. BNP Paribas undertakes no obligation to publicly revise or update any forward-looking statements in light of new information or future events.
The information contained in this presentation as it relates to parties other than BNP Paribas or derived from external sources has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on the fairness, accuracy, completeness or correctness of, the information or opinions contained herein. None of BNP Paribas or its representatives shall have any liability whatsoever in negligence or otherwise for any loss however arising from any use of this presentation or its contents or otherwise arising in connection with this presentation or any other information or material discussed.
Fixed Income Presentation – Asia - May 2011 | 3
2006- 2010 Achievements and 1Q11 Update
Strong Performances by Business
Growth Strategy
Liquidity and Funding
Fixed Income Presentation – Asia - May 2011 | 4
Group Overview
Geographic mix2010* Revenues
Business mix 2010* Revenues
1/2 Retail, 1/3 CIB, 1/6 IS 75% Western Europe, 60% domestic markets
BeLux RB 8%
PersonalFinance
12%
Equipment Solutions
4%
BNL bc7%
FRB16%
Retail Banking**
56%
Investment Solutions
15%
CIB 29%
France 36%
Italy 11%Belgium
10%
Luxembourg3%
Eastern Europe, Turkey &
Mediterranean5%
Australia Japan 2%
Other Western Europe
15%
Asia 4% GCC Africa 1%
Latin America 2%
North America 11%
Europe -Mediterranean
4%BancWest
5%
* Operating divisions ; ** Including 2/3 of Private Banking for FRB ( including PEL/CEL effects), BNL bc and BeLux RB
Fixed Income Presentation – Asia - May 2011 | 5
Reminder: Consolidated Group Results throughout the crisis
ROE 12.3% 21.2%
ROTE 15.8% 30.7%
2010
Recurrent and strong cash flow generation capacity
2006
28 31
4044
27
2006 2007 2008 2009 2010
Revenues
7.3 7.8
5.8
7.8
3.0
2006 2007 2008 2009 2010
Net income group share
€bn €bn
Fixed Income Presentation – Asia - May 2011 | 6
1Q11 Key Messages
Sustained business activity, growth in volumesin the domestic networks (deposits +8.5% vs. 1Q10, loans +3.9% vs. 1Q10)
Very good results confirming organic growth potential
Strong profit-generation capacity
High solvency level
Revenues: €11.7bn (+1.3% vs. 1Q10)
€2.6bn (+14.6% vs. 1Q10)
Common equity Tier 1 9.5%
Decline in cost of risk -31.3% vs. 1Q10
Fixed Income Presentation – Asia - May 2011 | 7
Revenues €11,685m +1.3%
Operating expenses -€6,728m +2.0%*
Gross operating income €4,957m +0.5%
Cost of risk -€919m -31.3%
Pre-tax income €4,109m +7.0%
Net income attributable to equity holders €2,616m +14.6%
1Q11 Consolidated Group1Q11 1Q11 vs. 1Q10
New organic profit growth
*Including impact due to the introduction in 2011 of “systemic” taxes reattributed to all business units:
-€186m expected for the whole of 2011 -€45m +0.7%
Annualised ROE 15.1% +0.7pt
Fixed Income Presentation – Asia - May 2011 | 8
884
2 1082 191
1 403
538663
2 062
2 616
3 031
1 270 1 185
2 608
4 058
JP Morgan HSBC BNP Paribas Wells Fargo Citi Santander DeutscheBank
UBS Bank ofAmerica
Barclays CreditSuisse
GoldmanSachs
MorganStanley
1Q11 Net Income
Net income attributable to equity holders *
€m **
* Source: banks; ** Average 1Q11 exchange rates
Solid profitability
Fixed Income Presentation – Asia - May 2011 | 9
5.7
1.9 2.2 3.1
5.8
2.6 2.03.4
5.9
2.8 2.03.8
6.5
3.0 2.2
4.36.9
3.1 3.42.3
5.1
2.0
16.4 17.5
5.0
14.9
8.14.4
8.25.3 4.9
21.1
5.4
13.5
24.0
6.212.0
Reminder: Revenues of the Operating Divisions 2006-2010
*Including 100% of Private Banking in France (excluding PEL/CEL effects), Italy and Belgium
Strong organic and external growth throughout the cycle
2010
2008
€bn
Retail Banking * Investment Solutions CIB
FRB* BNL bc* Personal Finance
of which
BeLuxRetail Banking*
€bnBancWest
2009
20072006
Fixed Income Presentation – Asia - May 2011 | 10
5 917
1 431
3 786
6 125
1 605
3 462
1Q11 Revenues of the Operating Divisions
* Including 100% of Private Banking in France (excluding PEL/CEL effects), Italy and Belgium
Good level of revenues across all business units
1Q111Q10
€m
+3.5%
+12.2%
Retail Banking* Investment Solutions CIB
-8.6%
Retail Banking: good sales and marketing driveInvestment Solutions: very solid performanceCIB: held up well vs. an exceptional 1Q10
Fixed Income Presentation – Asia - May 2011 | 11
Cost/income
3 475
1 0121 872
3 572
1 1131 824
1Q11 Operating Expenses of the Operating Divisions
* Including 100% of Private Banking in France (excluding PEL/CEL effects), Italy and Belgium
Operating expenses under control
1Q111Q10
€m
Retail Banking* Investment Solutions CIB
58.3% (-0.4pt vs. 1Q10) 69.3% (-1.4pt vs. 1Q10) 52.7% (+3.3pt vs. 1Q10)Best level in the industry
Of which effect of “systemic” taxes introduced in 2011:
Operating expense trend
+0.5% +0.3% +1.1%
+2.8% +10.0% -2.6%YoY %
Fixed Income Presentation – Asia - May 2011 | 12
BNP Paribas FortisSynergies
Synergies in line with the new plan
733
2009 2010 2011 2012
Net cumulative synergies
(€m) 1,200965
598 Planned
120
Cumulative synergies as at 31.03.11: €733mOf which €135m achieved in 1Q11
Reminder: Total expected synergies to 2012 increased from €900m to €1,200mRestructuring costs* increased from €1.3bn to €1.65bn (€0.6bn in 2011, of which €0.1bn in 1Q11)
Realised
* Booked in Corporate Centre
Breakdown of synergies by business unit in 2012
43% CIB
Retail Banking 26%
Investment Solutions 16%
Functions & IT 15%
Including12%
Belgium
Fixed Income Presentation – Asia - May 2011 | 13
Variation in the Cost of Risk by Business Unit (1/3)
Cost of risk: €919m-€418m vs. 1Q10-€243m vs. 4Q10
Decline in doubtful outstandings* in 1Q11: -€1.5bn vs. 31.12.2010
120140
72 8366 72 68 54
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
Group
Net provisions/Customer loans (in annualised bp)
25
98
324
-25
0 13 9
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
CIB Financing businessesCost of risk: €37m
Compared to €93m in 1Q10Compared to €51m in 4Q10
Limited provisions offset by write-backs
* Gross doubtful loans, on and off-balance sheet, net of guarantees and collaterals
Fixed Income Presentation – Asia - May 2011 | 14
Net provisions/Customer loans (in annualised bp)
Variation in the Cost of Risk by Business Unit (2/3)
Cost of risk: €80m -€42m vs. 1Q10-€62m vs. 4Q10
Decrease accelerated by a seasonal effect
18
41 35 36 32 3141
23
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
FRB
61
107 107 108 108 105 10091
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
BNL bc
Cost of risk: €198m-€2m vs. 1Q10-€5m vs. 4Q10
Confirmed stabilisation
56
277
32 35 3217
2008 2009* 2010 1Q10 2Q10 3Q10 4Q10 1Q11
BeLux Retail BankingCost of risk: €35m
+€20m vs. 1Q10-€32m vs. 4Q10
Low level amplified by a seasonal effect
* Pro-forma
Fixed Income Presentation – Asia - May 2011 | 15
Net provisions/Customer loans (in annualised bp)
Variation in the Cost of Risk by Business Unit (3/3)
176
355
146 117 130 150 185 180
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
Europe-MediterraneanCost of risk: €103m
+€35m vs. 1Q10-€6m vs. 4Q10
Portfolio provisions for Tunisiaand Egypt: +€28mStabilisation confirmed in Ukraine
180
310
119163 132 107 79 78
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
BancWestCost of risk: €75m
-€75m vs. 1Q10Unchanged vs. 4Q10
Continued to improve asset quality
173
264226 252 231 219 205 196
2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11
Personal FinanceCost of risk: €431m
-€91m vs. 1Q10 -€7m vs. 4Q10
Decrease in most countries
Fixed Income Presentation – Asia - May 2011 | 16
4.63.9
5.3
1.6
4.5
1.9
3.5
-1.2
4.0
1.32.3
1.5
4.9
2.0
4.8
Reminder: Pre-Tax Income of the Operating Divisions 2006-2010
*Including 2/3 of Private Banking in France (including PEL/CEL effects), Italy and Belgium
Rebalancing of the divisions’ contributionsdue to a rebound in Retail Banking income
2010
2008
€bn
Retail Banking* Investment Solutions CIB
2009
20072006
Pre-tax ROE 19% 31% 38%
32% pro forma Basel 2.5
~30% (est.) pro forma full Basel 3
Fixed Income Presentation – Asia - May 2011 | 17
1 281
464
1 714
546
1 6351 604
1Q11 Pre-Tax Income of the Operating Divisions
* Including 2/3 of Private Banking in France (excluding PEL/CEL effects), Italy and Belgium
Strong contribution from all divisions
1Q111Q10
€m
+25.2%
+17.7%
Retail Banking* Investment Solutions
CIB
-4.6%
Fixed Income Presentation – Asia - May 2011 | 18
Reminder: Solvency 2006-2010
Common Equity Tier 1: +€28.4bn since 31.12.2006 (x2 in 4 years)O/w organic equity generation: +€15.2bnO/w switch to Basel 2 (insurance,…): -€2.7bnO/w effect of the Fortis deal: +€10.8bnO/w rights issue: only €4.2bn in 2009O/w scrip dividends paid in 2009 and 2010: €1.2bn
Powerful capacity to generate equity organically
Common Equity Tier 1 ratio
27.0 30.1 29.049.6 55.4
7.3% 8.0%
5.8% 5.6% 5.4%
9.2%
7.4%
10.1%11.4%
7.8%
31.12.06 31.12.07 31.12.08 31.12.09 31.12.10
Capital ratios
Tier 1 ratio
Common Equity Tier 1 capital
€bn
Limited dilution
Fixed Income Presentation – Asia - May 2011 | 19
Risk-Weighted Assets: +€136bn since 31.12.2006 (+29.5% within 4 years)O/w effect of the switch to Basel 2 as at 01.01.08: -€60bn (mainly in credit risk on businesses eligible to advanced approach)O/w effect of the Fortis deal: +€166bnO/w steered reduction since end 2008: -€93bn, mainly in CIB
RWA 2006-2010
Constant optimal management of RWA
465540
480 528601621
-20-60
-73+166
31.12.06 31.12.07 Switch toBasel 2
01.01.08 31.12.08 FortisContrib.
RWAreduction
31.12.09 RWAreduction
31.12.10
Risk-Weighted Assets
€bn
Fixed Income Presentation – Asia - May 2011 | 20
1Q11 Solvency and RWA
9,0% 9,2% 9,5%8,4%8,3%
31.03.10 30.06.10 30.09.10 31.12.10 31.03.11
Tier 1 ratio
Common equity Tier 1
10.5% 10.6%
Hybrids
Common equity Tier 1 ratio: 9.5% as at 31.03.2011Pro-forma ratio under Basel 2.5: 8.8%
Tier 1 ratio: 11.7% as at 31.03.2011
Shareholders’ equity:Common equity Tier 1: €56.6bn (+€1.2bn vs. 31.12.2010)Tier 1 capital: €69.8bn (+€1.2bn vs. 31.12.2010)
Risk Weighted Assets: €595bn as at 31.03.2011 (-€6bn vs. 31.12.2010)
Of which rises in domestic networks: +€3bn vs. 31.12.10
11.2%
High Solvency
11.4% 11.7%
Fixed Income Presentation – Asia - May 2011 | 21
736 804 9141,219
704890
1,162839 810
518
1188
-429
-107
31.12.06 31.12.07 31.12.08 FortisContribution
Steeredreduction
31.12.09 31.12.10
Balance Sheet 2006-2010
Active balance sheet management since Fortis acquisition
Balance sheet: assets€bn
Banking Book
Trading Book
2,058 1,998
1,6941,440
2,076
968 Loans & other assets
220 AFS
223 Other trading
353 Derivatives
234 Repos
Fortis
BNP Paribas excl. Fortis
Fixed Income Presentation – Asia - May 2011 | 22
Earnings per Share, Book Value per Share
A model generating robust growth in asset value throughout the cycle
7.8 8.3
3.05.2
6.3
2006 2007 2008 2009 2010
Earnings per share 2006-2010
+21.7%
€
Net book value per share 2006-2010
€
30.3 34.5 33.7 39.8 43.9
2006 2007 2008 2009 2010
+9.0%
42.9 47.4 47.3 50.955.5
Net tangible book value per share
+10.3%
1Q11 Earnings per share
+13.6%
€1,9
2,1
1Q10 1Q11
1Q11 Net book value per share
€41,4 43,9 46,4
31.03.10 31.12.10 31.03.11
55.5 57.752.9
+5.5%
+9.1%
+4.0%
Fixed Income Presentation – Asia - May 2011 | 23
2006- 2010 Achievements and 1Q11 Update
Strong Performances by Business
Growth Strategy
Liquidity and Funding
Fixed Income Presentation – Asia - May 2011 | 24
2010 Retail Banking - Overview
69% of retail revenues generated in domestic countries
* Including 100% of Private Banking in France (excluding PEL/CEL effects), Italy and Belgium; ** Including of 2/3 of Private Banking in France (PBF), Italy and Belgium
Retail BankingGeographic Mix
Revenues 2010 *
BeLux14%
Central and Eastern Europe, Turkey, Mediterranean
8%
US 10%RoW 3%
Italy17%
Other Western Europe
10%
69% domestic markets
France38%
Revenues* +4.0%
Cost/Income* (60.8pt): -1.0pt
Cost of risk* -28.8%
Pre-Tax Income** x2.0
Pre-tax ROE 19.0%
2010/2009(at constant scope
and exchange rates)
Fixed Income Presentation – Asia - May 2011 | 25
66.0%
58.8%
71.3%
2009 2010
82.4
69.4
138.5
2009 2010
Strong cash flow generation capacity in sound markets
Strong volumesDeposits: strong inflows in current accounts (+7.5%* vs. 2009)Loans: +2.4%* vs. 2009, o/w +6.5% in mortgages (71% of total Group mortgage outstandings)
Cost control discipline maintained in the 4 networksCost of risk
France & Belgium: moderate level confirmedItaly: stabilisation at a high level
Pre-tax ROE: 21%BNL bc still in Basel 2 standardised approach
*At constant scope, including 100% of Private Banking in France (excluding PEL/CEL effects), Italy and Belgium
2010 Retail Banking - Domestic NetworksLoan growth*
+0.3%
€bn
+3.6%
+2.2%
+2.4%
FRB
BeLux
BNL bc
290
Cost/Income Ratio*
variation in pt
-1.3
-0.9
-2.8
FRB
BeLux
BNL bc
Fixed Income Presentation – Asia - May 2011 | 26
75,369,5
1Q10 1Q11
French Retail Banking - 1Q11
Vigorous business and income growth* Feb.2011 vs. Feb.2010; **Including 100% of French Private Banking (FPB), excluding PEL/CEL effects ;
*** Including 2/3 of FPB, excluding PEL/CEL effects
Strong sales and marketing drive Loans: +3.5% vs. 1Q10, of which individual customers +8.4% and VSEs & SMEs +4.2%*Deposits: +10.8% vs. 1Q10, strong growth overall
Continued improvement of the customer relations organisation70% of branches remodelled based on the Welcome & Services format 37 “Small Business Centres” already opened including 4 in 1Q11Online banking: 2.2 million users; the all online branch Net Agence has over 10,000 customers
Revenues**: €1,791m (+2.5% vs. 1Q10)Net interest income: +2.6% vs. 1Q10Fees: +2.5% vs. 1Q10
GOI**: €692m (+4.5% vs. 1Q10)Operating expenses: +1.3% vs. 1Q10
Pre-tax income***: €579m (+14.2% vs. 1Q10)
€bn
Deposits
+10.8%111,2
100,3
1Q10 1Q11
€bn
Loans to individualcustomers
+8.4%
Fixed Income Presentation – Asia - May 2011 | 27
674
25
709 734
614 186 270
2007 1Q11 Objective2013
BNL banca commerciale - 1Q11 Revenues*: €782m, +3.0% vs. 1Q10
Loans: +4.0% vs. 1Q10, good overall driveDeposits: -4.8% vs. 1Q10, strong price competition on corporate and local government depositsFees: rise in insurance products and cross-selling with CIB (cash management, structured finance)
Operating expenses*: +2.5% vs. 1Q10Effects of synergiesStrengthened commercial network:27 “Small Business Centres” already opened, including 13 in 1Q11;26 new branches scheduled to open in 2011
Pre-tax income**: €136m (+10.6% vs. 1Q10)
* Including 100% of Italian Private Banking; ** Including 2/3 of Italian Private Banking
Loans
Good operating performance; continuation of commercial investments
Branches
739920
plannedrenovation
renovated
new branches (net)
~ 1,000
71,268,4
1Q10 1Q11
€bn
+4.0%
Fixed Income Presentation – Asia - May 2011 | 28
BeLux Retail Banking - 1Q11
Strong growth in deposits and loans* Including 100% of Belgian Private Banking; ** Including 2/3 of Belgian Private Banking
Loans
81,485,1
1Q10 1Q11€bn
Good business driveLoans: +4.6% vs. 1Q10; strong mortgage growth (+14.7% vs. 1Q10) Deposits: +10.9% vs. 1Q10, good asset inflows for current accounts (+11.5% vs. 1Q10) and savings accountsPrivate Banking: assets under management + 8.5% vs. 1Q10Cash management: good revenue growth
Revenues*: €895m (+3.2% vs. 1Q10)Net interest income: good rise driven by growthin loans and depositsFees stable
GOI*: €281m (+5.6% vs. 1Q10)Operating expenses: +2.2% vs. 1Q10
Pre-tax income**: €227m, -3.8% vs. 1Q10Reminder: 1Q10 cost of risk very low
Deposits
91,1101
1Q10 1Q11€bn
+10.9%
+4.6%
Fixed Income Presentation – Asia - May 2011 | 29
5,6
6,86,66,36,0
1Q10 2Q10 3Q10 4Q10 1Q11
Europe-Mediterranean - 1Q11
Break-even in a troubled context * At constant scope and exchange rates, TEB & Fortis Turkey at 67.33%
Reminder of the new scope:Commercial banking activities in the Gulf transferred to CIBIvory Coast and Libya deconsolidated
Good sales and marketing driveDeposits: +8.1%* vs. 1Q10, very strong growth in most countries Loans: +4.1%* vs. 1Q10, especially in Turkey (+19.9%* vs. 1Q10), continued decline in Ukraine (-19.7%* vs. 1Q10)
Revenues: €404m, +1.6%* vs. 1Q10+5.1%* excluding Ukraine-14.7%* in Ukraine due to the decrease in outstanding loans
Operating expenses: +3.0%* vs. 1Q10
Pre-tax income: €3m
€bn
Deposits*
+8.1%16,1 17,4
1Q10 1Q11
€bn
Loans in Turkey*
+19.9%
Fixed Income Presentation – Asia - May 2011 | 30
2010 Retail Banking - BancWest
Significant recovery underway
Resurgence in business development in an improving economy
High net interest margin and increasing deposit baseStill weak loan demand but a recent pickup in corporate and consumer loan production
Cost income ratio: 54.7%, still at a low levelStep up commercial effectiveness of the network to boost customer acquisition, increase cross sellingUpgrade the branch network
Strong decline in the cost of risk119 bp (vs. 310 bp in 2009)
Pre-tax income: €573m
Pre-Tax ROE: 18%
333
-197
619
1,030
573
2006 2007 2008 2009 2010
Pre-tax income
€m
33.7 38.233.133.1
41.9
2006 2007 2008 2009 2010
Core Deposits*
$bn
*Deposits excluding Jumbo CDs
Fixed Income Presentation – Asia - May 2011 | 31
168 156153
96
167
1Q10 2Q10 3Q10 4Q10 1Q11
BancWest - 1Q11
* At constant exchange rates; ** Deposits excluding Jumbo CDs
Continued to boost profitability
Pre-tax income€m
41,544,5
1Q10 1Q11
Core Deposits**$bn
Revenues: €555m, +3.2%* vs. 1Q10 (+1.4%* vs. 4Q10)
Deposits: -1.4%* vs. 1Q10, still strong and regular growth in Core Deposits**Loans: -1.7%* vs. 1Q10, confirmation of the rebound in business loans (+4.3% vs. 1Q10)Improved mix and rise in net interest margin vs. 1Q10 (3.76%, +12bp)
Operating expenses: +8.0%* vs. 1Q10 (-1.1%* vs. 4Q10)
Low base in 1Q10 following the 2009 cost-cutting programmePick-up in business development, especially in the corporate and small business segmentsImpact of the new regulatory environment
Pre-tax income: €167m vs. €96m in 1Q10Decline in the cost of risk
+7.3%*
Fixed Income Presentation – Asia - May 2011 | 32
2010 Retail Banking - Personal Finance
Excellent operating performance
4Q10 consolidated outstandings: (€88.4bn)
Spain 11% Italy 13%
Other Western Europe 17%
France 42%
Eastern Europe 3%Others 3%Brazil 3%
Germany 4%Belgium 4%
Pursuing growth and industrialisation strategyFrance: industrial alliance with BPCEItaly: Findomestic integration planGermany: partnership with Commerzbank(1,200 branches, 11m customers)Turkey: takeover of TEB Cetelem in 4Q10
Strong loan growth with a low risk profile andgood profitability
Consolidated outstanding: +4.0%* vs. 2009
Cost/income: 46.0% (-9.4pt in 2 years)Cost of risk: decline in most countriesPre-tax income: x2 vs. 2009
Pre-tax ROE: 23%
* At constant scope and exchange rates
666
426
808885 893
2006 2007 2008 2009 2010
Pre-tax income
€m
Fixed Income Presentation – Asia - May 2011 | 33
Personal Finance - 1Q11
Continued fast-paced income growth
Growth in consumer loan production vs. 1Q10France, Italy, Central EuropeSuccessful partnership with Commerzbank in GermanyPF Inside in the Group’s networks: Poland, Ukraine, China
Revenues: €1,297m (+3.3% vs. 1Q10)Consolidated outstandings: +7.4% vs. 1Q10Effects of new restrictive legislation in France and ItalyRise in interest rates
Cost/income: 45.6%, stable vs. 1Q10Pre-tax income: €297m (+62.3% vs. 1Q10)
Decline in the cost of risk in most countries
241 271
196183
297
1Q10 2Q10 3Q10 4Q10 1Q11
Pre-tax income€m
Fixed Income Presentation – Asia - May 2011 | 34
2010 Investment Solutions (1/2)
Assets under management: €901bn as at 31.12.10 (+67.0% vs. 31.12.06)Effect of the Fortis integration: +€253bnStrong inflows throughout the crisis, incl. new cash in money market funds partly gone since thenDiversified geographic asset base: 12% from emerging countries
Performance effectNet asset
inflows Foreign exchange
effect
Assets under management* change since 31.12.06
Scope and other effects
541
+253 +34 +32 +33
901
31.12.1031.12.06
TOTAL
Assets under management increased to €901bn
€bn
*Including assets managed on behalf of external clients; as at 31.12.10
Other Europe17%
Belgium13%
Italy7%
Luxembourg5%
France 39%
AUM* by geography
Asia 8% GCC - Africa 2%
Latin America 2%
Australia – Japan 3%North America 4%
FortisAuM2009
+8
Fixed Income Presentation – Asia - May 2011 | 35
2010 Investment Solutions (2/2)
196 172553 814
714996
2009 2010
Integrated model generating strong profitability
Wealth Management 20%
Insurance25%
Securities Services20%
Investment Partners 20%
Others Wealth & Asset Management 15%
Business Mix 2010 Revenues
Wealth & Asset Management
Securities ServicesInsurance
Pre-tax income per business unit
€m
1,4631,982
+35.5%
Resilient business modelIntegrated model with excellent complementary fit between businessesAll businesses are core
Improved operating efficiency: cost/income at 70.8% (-2.1 pts* vs. 2009)
Pre-tax ROE: 31%Low capital consumption businesses
* At constant scope and exchange rates
Fixed Income Presentation – Asia - May 2011 | 36
Investment Solutions 1Q11 Asset Inflows and Assets under Management
Assets under management: €904bn as at 31.03.11
Stable vs. 31.12.10; +3.5% vs. 31.03.10Unfavourable foreign exchange effect due to the appreciation of the euro in 1Q11
Net asset inflows: +€8.3bn in 1Q11Private Banking: good asset inflows in domestic markets and in AsiaAsset Management: new mandates for diversified and bond funds; lower outflows from money market fundsInsurance: good asset inflows in France and outside of France
PerformanceeffectNet
assetinflows
Foreignexchange
effect
Assets under management* as at 31.03.11
Scope and
othereffects
901
+8.3 +1.0 -11.4 +5.2
904
31.03.1131.12.10
TOTAL
+0.1
+2.3
+0.4+0.9
+4.7
+8.3Net asset inflows in 1Q11
€bn
Positive net asset inflows across all business units
€bn
Wealth Management
PersonalInvestors
RealEstate Serv.
InsuranceAsset
Management
TOTAL
* Including assets managed on behalf of external clients
Fixed Income Presentation – Asia - May 2011 | 37
Investment Solutions 1Q11 Results
278 318352 425
801 862
1Q10 1Q11
Wealth and Asset Management
Securities ServicesInsurance
Revenues per business unit
€m
* Asset Management, Private Banking, Personal Investors, Real Estate Services
1,431 1,605+12.2%
33 43179 225
252278
1Q10 1Q11
Wealth and Asset Management
Securities ServicesInsurance
Pre-tax income per business unit
€m
464546
+17.7%
Revenues: €1,605m, +12.2% vs. 1Q10WAM*: +7.6% vs. 1Q10, very good performance of Personal Investors, especially in Germany, and of Wealth ManagementInsurance: +20.7% vs. 1Q10, continued strong growth, especially protection insurance products outside of FranceSecurities Services: +14.4% vs. 1Q10, pick-up in business confirmed
Operating expenses: +10.0% vs. 1Q10Continued investments especially in AsiaPositive jaws effect across all business units
Pre-tax income: €546m, +17.7% vs. 1Q10
A growth driver for the Group
Fixed Income Presentation – Asia - May 2011 | 38
1,140 1,036
1,874 1,258 1,211 1,065
36778
631
475522
587
1,1591,0331,060907812797
9052,261 1,940
2,895
845
268
1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10
2010 Corporate and Investment Banking (1/2)
European leader, client centric, with diversified business mix
Financing businesses: leadership in Europe and recognised global franchisesStrong and recurrent revenue base
Capital markets: strong franchises beyond intrinsic volatilityGlobal leading provider of derivativesRanked number 1 for “All Corporate bonds in euros” (Thomson Reuters)
€mRevenues 2007-2010
Financing Businesses
Fixed Income
Equity and Advisory
2,440
3,4783,8513,728
2,0581,8521,3111,374
-248
1,9682,4522,377
3,752
2,685 2,873 2,688€8bn
€5bn
€13.5bn€12bn
FY Revenues
Fixed Income Presentation – Asia - May 2011 | 39
2010 Corporate and Investment Banking (2/2)
The best operating efficiency in the industry
All 2010 variable compensation components booked in 2010Including the deferred and conditional part (payable in 2011, 2012 and 2013)
2010 cost/income ratio: still the best in the industryAfter bolstering the franchise in Asia and in the U.S.
69.0%
53.7%60.1%
81.9%
61.0%65.9% 63.3%
78.8%
UBS CS DB JPM BofA Barclays SG BNPP
2010 cost/income ratio*
*Source: banks
Fixed Income Presentation – Asia - May 2011 | 40
RWA: €71bn as at 31.12.2010Only 12% of Group’s total RWA O/w €10bn for market risks RWA
€19bn for counterparty risks RWAEnd user oriented
Limited impact of Basel 2.5/3 vs. peers: ~+€60bn additional RWA…Low VaR: €43m as at 31.12.10Reclassified assets: only €6bn as at 31.12.10; flat shadow P&L*Securitisation: already included in RWA (no deduction from capital 50/50)Counterparty risk already calculated with a stressed scenario
….even without taking into account any mitigation actionBeyond day-to-day optimisation
3.9%
15.3%14.1%
2.9%
10.5%6.8%
8.7%
3.5%
BNPP HSBC SG DB CS UBS RBS** BARC
CIB - Capital Markets: Basel 2.5 & Basel 3
Basel 2.5 & 3 RWA: limited impact as compared with CIB competitors
* If no reclassification had been implemented, the aggregate pre-tax income since the first reclassification, would have been quite similar** Total RWA before “Asset Protection Scheme Relief”
Benchmarking Market risks RWA
Source: banks, as of 31.12.10
as a % of total RWA
Fixed Income Presentation – Asia - May 2011 | 41
1 064 1 194 1 170 1 067 1 136
1 877 1 262 1 209 1 0681 634
845
268 522 590
692
1Q10 2Q10 3Q10 4Q10 1Q11Financing Businesses Fixed Income Equities and Advisory
Corporate and Investment Banking - 1Q11
Very solid performance across all business units
Revenues: €3,462m (-8.6% vs. an exceptional 1Q10)
Capital Markets: sustained business in a context of volatile markets, good volume of bond issues Financing businesses: business held up well and high level of fees in Structured Finance
Operating expenses: -2.6% vs. 1Q10Cost/income: 52.7%Impact of new hirings in 2010: especially in Fixed Income and Structured Finance
Pre-tax income: -4.6% vs. 1Q10
€m3,786
2,901
Revenues
2,724 2,725
3,462
1 6351 259
1 714
1Q09 1Q10 1Q11
Pre-tax income€m
Fixed Income Presentation – Asia - May 2011 | 42
Corporate and Investment Banking Capital Markets - 1Q11
* Source: Thomson Reuters
Revenues: €2,326m (-14.5% vs. an exceptional 1Q10)Fixed Income: -12.9% vs. 1Q10, + 53.0% vs. 4Q10
Credit and Rates: sustained volumes and broad diversity of issuers; breakthrough in Yankee bonds and still # 1 in all euro bond issuesEnergy and commodity derivatives: sustained business driven by clients’ hedging requirements given the rise in oil prices
Equities and Advisory: -18.1% vs. 1Q10, + 17.3% vs. 4Q10
Significant contribution of flow and structured product businessesContinued distributing capital guaranteed structured products through retail and insurance networks
Good performance in volatile markets
2007 2010 1Q11
All International Bondsranking*
#13
#9
#4
2007 2010 1Q11
All Bonds in Eurosranking*
#5
#1 #1
Fixed Income Presentation – Asia - May 2011 | 43
Corporate and Investment Banking Financing Businesses - 1Q11
Good business activity, especially in Structured Finance
Geographic revenue breakdown1Q11 Revenues
Eastern Europe 6%
Western Europe46%
Middle EastAfrica
8%
Asia-Pacific14%
Americas26%
Revenues: €1,136m (+6.8% vs. 1Q10)Energy and Commodities: strong business in a context of high pricesAircraft: leading position confirmed Cash Management: sustained growth in competitive markets, especially in Europe and AsiaTrade Finance: business development, in particular in the Americas and in Europe
Fixed Income Presentation – Asia - May 2011 | 44
2006- 2010 Achievements and 1Q11 Update
Strong Performances by Business
Growth Strategy
Liquidity and Funding
Fixed Income Presentation – Asia - May 2011 | 45
Integrated business model enabling continued outperformance in wealthy and sound markets
Growth Strategy in Domestic MarketsPursue growth in robust markets
Household savings rates above 14%*Sound real estate marketsSustained loan demand due to low debt per capita
Extend cross-selling Inside Retail Banking: integrated model and shared platforms; speed up distribution of Personal Finance productsRetail Banking - IS: continue rolling out the Private Banking model; develop the distribution of insurance productsRetail Banking - CIB: continue developing cash management services, trade finance, interest rates and forex productsIS - CIB: expand the product offering of BPSS; alternative management solutions with Equity Derivatives
* as a % of gross disposable income in 2009
5.9%
18.3%16.0% 15.3% 14.0%
6.3%
Belgium France Eurozone Italy UK US
Gross savings rate in 2009*
Fixed Income Presentation – Asia - May 2011 | 46
+34%
+7%
+29%+30%
+42%
2006 2007 2008 2009 2010
Growth Strategy in Other Retail Markets: Focus on Turkey
Roll out the integrated model in an attractive market to extract further value from the “New TEB”
* Source: BRSA ; ** Source: Central Banks (2009), EU-15 : European Union 15; *** 67% consolidated
A robust, dynamic and promising marketSizeable market (76m inhabitants) with significant GDP growth potentialStrong lending growth (+28% over the last 5 years) and resilient profitability throughout the crisisLow banking penetration rate (loans/GDP** at 39% vs 148% in EU-15)
Turkey - loan growth*
% yoy growth
Average (2006-10) +28%
Merger of TEB & Fortis Bank Turkey completed
Leading to a #9 ranking in TurkeyRoll-out of the integrated model: €86m of net synergies expected by 2013€123m of restructuring costs over 3 years
Net cumulative synergies***
Net revenue synergies
Cost synergies
€m16
50
86
-4 42120
46
65
2011 2012 2013
Fixed Income Presentation – Asia - May 2011 | 47
Growth Strategy in Asia - PacificCIB: strengthen strong established positions
Transaction Banking: invest to industrialize and upgrade cash management and trade services platformFinancing: consolidate the strong franchises especially in Energy and CommoditiesCapital Markets: develop local Fixed Income product offering, broaden client base for equity products
Investment Solutions: become a major playerAsset Management: capitalise on the existing organisation to boost growthWealth Management: confirm the Top 5 position from Hong-Kong and SingaporeInsurance: maintain growth momentum in India, Japan, Korea and TaiwanSecurities Services: building a significant provider covering all major markets
France29%
BeLux11%
North America 13%
RoW 5%
Italy4%
Other Western Europe
26%
12% revenues from Asia-Pacific
CIB - IS Geographic MixRevenues 2010
Build on already strong set-up in a fast-pace growth region
Fixed Income Presentation – Asia - May 2011 | 48
2006- 2010 Achievements and 1Q11 Update
Strong Performances by Business
Growth Strategy
Liquidity and Funding
Fixed Income Presentation – Asia - May 2011 | 49
BNP Paribas Funding StrategyStrong and stable credit ratings
SENIOR UNSECURED DEBTStandard & Poor’s Moody’s Fitch
Last Rating Change
Long Term Ratings
Outlook
BNP Paribas Home Loan Covered Bonds
AA
Negative
28.01.2009
Confirmed on 9.02.2011
A-1+
Rating Status
Short Term Ratings
COVERED BOND PROGRAMMESStandard & Poor’s Moody’s Fitch
BNP Paribas Public SectorSCF
Aa2
Stable
20.01.2010
Updated
Prime-1
AA-
Stable
21.06.2010
Updated
F1+
AAA
AAA
Aaa
Aaa
AAA
AAA
Fixed Income Presentation – Asia - May 2011 | 50
Large deposit base: €553bn (+2% vs. 31.12.2009)With a beginning of re-intermediation in France from money market mutual funds
Central bank eligible collateral available: €160bnHigh quality collateral for Covered Bond issues
Very good quality mortgages in eurosAssets guaranteed by AAA rated Export Credit Agencies
Ability to diversify MLT issues with attractive spreadsIn all the leading currencies (EUR, USD, AUD, JPY)For various maturities & types of issuance (unsecured and secured)Access to specialised sources of financing
2010 Liquidity
A competitive edge in the access to a wide variety of liquidity sources
2010 MLT funding structure
Private Placements
34%
Senior Unsecured
Public Issues28%
Covered Bonds24%
LT Repos 5%
Retail Banking9%
Fixed Income Presentation – Asia - May 2011 | 51
Spre
advs
. Mid
swap
(in
bp)
2011 MLT issue programme: €35bn€22bn issued as of 17 May 2011Average maturity > 6 yearsIn the main currencies: EUR, USD, AUD, JPY
Favourable issue terms in various segments
Jan 2011: 3-year Senior unsecured AU$ 850m (equiv. US$ Libor + 91 bp) Feb 2011: 5-year Senior unsecured US$ 2bn (equiv. US$ Libor + 112 bp)March 2011: 5-year dual tranche Senior unsecured ¥ 62bn (equiv. swap +30 bp for fixed rate tranche)May 2011: 3-year Senior unsecured €1bn (equiv. Euribor + 47 bp)May 2011: 5-year Senior unsecured AU$1bn (equiv. US$ Libor + 109 bp)
1Q11 Liquidity
Diversified refinancing on competitive terms
0
50
100
150
200
0 2 4 6 8 10 12
Terms at issuanceEuro senior debt, March/April 2011
BBVA
SANTANDER
ING
BARC
Amount in €bn
BNPP
SGHSBCCASA BNPP
CASA
Maturity (years)
BNPP
Fixed Income Presentation – Asia - May 2011 | 52
5 7 15 13 10 7 54 12 16
40 444354
94101 104
128 121
1216
1819 18
2823
4
7
89 12
1313
11
2004 2005 2006 2007 2008 2009 2010
Tier 1 hybrid
Subordinated
Senior unsecured
Covered bonds + CRH+SFEFSecuritisation
Medium and Long Term Funding
Funding programme has evolved with the Bank’s growthSource: BNP Paribas ALM excluding debt with maturity less than one year
Medium and Long Term outstanding fundingIncluding BNL Including Fortis
6585
139154 160
216 207
Fixed Income Presentation – Asia - May 2011 | 53
Conclusion
Strong cash flow generation capacity throughout the cycle
Enabling significant internal and external growth with a continuous strengthening of solvency
Providing leeway to keep on creating value organically in the new regulatory environment
Fixed Income Presentation – Asia - May 2011 | 54
Appendices
Fixed Income Presentation – Asia - May 2011 | 55
Asset and Liability Interest Rate Risk Management
*Coupon minus carrying costs
Fall in rates Rise in rates
P&L
Revalued OCI
Margin on deposits
Government bonds return* (AFS)
Fair value ofgovernment bonds
(AFS)
Government bonds hedge retail banking activities against a drop in interest rates (but also limit the favourable effects of rising interest rates)Worst case scenario: interest rates remain low on a long-term basis and flat yield curveBest case scenario: steep yield curve
Impact of changes in interest rate
Fixed Income Presentation – Asia - May 2011 | 56
Information Technologies & Electronics 1%
Total gross commitments on & off-balance sheet, unweighted = €1,296bn as at 31.12.10
Institutions 14%
Retail 30%
Other 4%
Central governments and Central Banks 15%
Agriculture, Food, Tobacco 2%Construction 2%
Retailers 2%Energy excl. Electricity 3%
Equipment excl. IT Electronic 2%
Real Estate 4%
Metals & Mining 2%
Wholesale & trading 6%
B to B services 4%Communication Services 1%
Transportation & logistics 4%Utilities (Electricity, Gas, Water) 2%
Chemicals excl. Pharmaceuticals 1%
Breakdown of Commitments by Industry
Healthcare & Pharmaceuticals 1%
Fixed Income Presentation – Asia - May 2011 | 57
Breakdown of Commitments by Region
Total gross commitments on & off-balance sheet, unweighted = €1,296bn as at 31.12.10
France 26%
Belgium & Luxembourg 13%
Australia-Japan 3%
Other Western Europe 8%
GCC-Africa 3%
North America 12%
Latin America 2%
Eastern Europe 3%
Italy 12%
Germany 3%
Emerging Asia 5%
Netherlands 3%United Kingdom 4%
Mediterranean Basin 1%Turkey 2%
Fixed Income Presentation – Asia - May 2011 | 58
Update of Sovereign ExposuresExposures as at 31 December 2010*
* Excluding insurance
O/w banking book
O/w trading book
Austria 1,190 1,190 0 1,145Belgium 22,046 22,046 0 22,225Bulgaria 6 6 0 14Cyprus 91 75 16 80
Czech Republic 165 165 1 156Denmark 0 0 0 0Estonia 0 0 0 8Finland 800 523 277 446France 16,287 16,287 0 16,294
Germany 9,642 5,993 3,649 9,633Greece 5,018 4,539 479 5,046Hungary 963 796 167 1,030Iceland 0 0 0 60Ireland 433 433 0 351
Italy 22,079 21,835 243 21,910Latvia 0 0 0 21
Liechtenstein 0 0 0 0Lithuania 36 35 0 48
Luxembourg 463 463 0 463Malta 0 0 0 0
Netherlands 9,386 9,386 0 9,229Norway 116 101 15 129Poland 2,962 2,879 83 2,997Portugal 1,733 1,733 0 1,875Romania 109 76 33 120Slovakia 34 32 2 33Slovenia 342 61 280 311
Spain 2,903 2,903 0 3,708Sweden 40 0 40 0
United Kingdom 1,821 1,424 396 1,719
Gross exposure
(1) Including credit derivatives
Net exposure(1)In €m
Fixed Income Presentation – Asia - May 2011 | 59
4562
10087 92
128
80
130
74 789616
90
54 6972
49
110
62
123 122107
Turkey Spain Belgium France Eurozone Italy UK Greece Ireland US* Portugal
Domestic Retail Markets
Sound domestic markets
Government and Households consolidated debt by country (2009)
% GDP
152164
156
177
192 197
Source: Eurostat, Federal Reserve and CbT,* Households incl Farm business; Government incl Federal and local
GovernmentHouseholds 200
154
190203
61
Fixed Income Presentation – Asia - May 2011 | 60
-29 -30 -29 -43 -39 -51 -48 -55 -53 -75 -79-115 -88 -77 -81 -80 -63 -53 -51 -52 -61
16 14 17 23 18 19 24 38 42 47 57 75 57 41 39 42 45 36 30 35 3613 13 14 14 13 20 1926 30 37 37
6046
40 42 39 31 25 21 30 4015 15 14 25 24
4160
45 4260 45
66
3427 37 46
2220 33 19 15
23 20 21 25 2339
67 68 73 87 80111
6952 56 63 51 42 46 43 43
1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
CommoditiesForex & othersEquitiesInterest rateCredit Nettings
Low VaR in 4Q10 and 1Q11 Due to significant reduction in market risks since 4Q08 Despite more risky environment reflected in market parameters, compared to 2006
VaR model proven to be robust during the crisisOnly 10 days of losses above the VaR over the last 5 years, consistent with the 99% statistic
€m
Average VAR* (99% 1 day)
* Excluding BNP Paribas Fortis (BNP Paribas Fortis: average VaR €10m in 4Q10)
CIB - Market Risks
Trading VAR